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Notes from Apple’s Q1 2014 conference call

Apple’s Q1 2014 earnings conference call after the company’s reported record quarter started with Apple CFO Peter Oppenheimer discussing the company’s all-time quarterly records for iPhone and iPad sales. Oppenheimer cited iPhone market share numbers in various markets — he said iPhone has 69 percent of the smartphone market in Japan — in addition to mentioning web traffic numbers from iPhone and iPad.

As of this month, 80 percent of iOS devices are running iOS 7, Oppenheimer confirmed, following Apple’s quiet release of those numbers earlier today.

Oppenheimer said iTunes services made $4.4 billion in the quarter, with $2.4 billion in sales from iTunes alone. Apple has paid a total of $15B to App Store developers. Mentioning some specific apps, Oppenheimer said Clumsy Ninja was downloaded 10 million times in the first week of release, and Plants vs. Zombies 2 was downloaded 16 million times in the first five days of release. He also briefly mentioned iBeacon, which is now showing up in Apple stores.

During the Q&A, Apple CEO Tim Cook said last week was the best ever in China for iPhone activations. “We really turned in a stellar quarter in greater China overall and we’re really proud of it,” he said.

Asked about mobile payments, Cook said, “The mobile payments ... in general is one that we’ve been intrigued with ... and that was one of the thoughts with Touch ID.”

On iPhone market share, Cook mentioned the growth in emerging markets, but also said, “Our North American business contracted somewhat year over year.” He said iPhone 5s supply wasn’t strong enough. Carriers changing their upgrade policies is also having a major effect on North American sales, Cook said.

When asked if Apple is still a growth company, Cook referred back to Oppenheimer’s comments while reiterating the iPod is bringing down the overall numbers.

On iPhone user growth, Cook also said Apple saw significant new-to-iPhone numbers on the 5c. “It’s typically not just upgraders,” he said.

On expanding the iPhone product family, Cook said, “We’re willing to make any product that’s a great product. Our line in the sand is making something that’s not fantastic.”

When asked about 5c sales, Cook played up the 5s. He said, “People are really intrigued with Touch ID. It’s a major feature that has excited people.”

To end the call, Cook made a vague comment on future products, saying “Innovation is deeply embedded in everybody here ... we have zero issue coming up with things we want to do that we think we can disrupt in a major way.”

Comments

That's it, Tim, blame the declining iPod sales. When was the last time Apple even gave a second thought to the iPod Classic, the device that allowed you to expand into unchartered territory (and profits)? That gave birth to the iTunes Store, the iPhone, the iPad, and even iTunes Match.... the Cloud.... and yet you just dismiss it.
Update the Classic. Give it a refresh, starting with a minimum of 256GB flash storage. Some people like to have all their music with them all the time, and not be beholden to a WiFi connection and data quotas to listen to their music.
Jeez, your company is such a cheapsake sometimes. You rake us over the coals for the price of 16/32/64/128 gb storage, and you lock us into your Eco-System, and yet you can't give us the music we purchased and outright own.Posted by JonnyOneNote on 2014-01-28 00:53:55